My inferior shell is bash.  I have confirmed that this problem exists

with 'emacs -Q'.  Re-setting my PS1 to the bash default PS1='\h:\w\$ '

and starting Emacs didn't help either.

Steps to reproduce:

1. emacs -Q

2. M-x ansi-term RET RET

3. cd /tmp (or any other directory)

4. C-x C-f 

Expected behavior:

Emacs will indicate the shell's working directory (/tmp) in the

find-file minibuffer prompt.

Actual behavior:

Emacs indicates the Emacs working directory working directory ($HOME,

for me) in the find-file minibuffer prompt.

I found that if I revert commit aad65192332dfc4a1df0cd2953554c21da243b51

the problem goes away.

In GNU Emacs 25.0.50.1 (x86_64-pc-linux-gnu, GTK+ Version 3.10.8)

 of 2015-04-19 on lgw01-10

Windowing system distributor `The X.Org Foundation', version 11.0.11501000

System Description: Ubuntu 14.04.2 LTS

Configured using:

 `configure --build=x86_64-linux-gnu --prefix=/usr

 '--includedir=${prefix}/include' '--mandir=${prefix}/share/man'

 '--infodir=${prefix}/share/info' --sysconfdir=/etc --localstatedir=/var

 '--libdir=${prefix}/lib/x86_64-linux-gnu'

 '--libexecdir=${prefix}/lib/x86_64-linux-gnu' --disable-maintainer-mode

 --disable-dependency-tracking --prefix=/usr --sharedstatedir=/var/lib

 --program-suffix=-snapshot --with-x=yes --with-x-toolkit=gtk3

 'CFLAGS=-g -O2 -fstack-protector --param=ssp-buffer-size=4 -Wformat

 -Werror=format-security' CPPFLAGS=-D_FORTIFY_SOURCE=2

 'LDFLAGS=-Wl,-Bsymbolic-functions -Wl,-z,relro''

Configured features:

XPM JPEG TIFF GIF PNG RSVG IMAGEMAGICK SOUND GPM DBUS GCONF GSETTINGS

NOTIFY LIBSELINUX GNUTLS LIBXML2 FREETYPE M17N_FLT LIBOTF XFT ZLIB

Important settings:

  value of $LANG: en_US.UTF-8

  value of $XMODIFIERS: @im=ibus

  locale-coding-system: utf-8-unix

Major mode: Lisp Interaction

Minor modes in effect:

  TeX-PDF-mode: t

  global-auto-complete-mode: t

  dirtrack-debug-mode: t

  magit-auto-revert-mode: t

  diff-auto-refine-mode: t

  elisp-slime-nav-mode: t

  display-time-mode: t

  shell-dirtrack-mode: t

  global-company-mode: t

  company-mode: t

  xterm-mouse-mode: t

  winner-mode: t

  which-function-mode: t

  show-paren-mode: t

  global-auto-revert-mode: t

  tooltip-mode: t

  global-eldoc-mode: t

  electric-indent-mode: t

  mouse-wheel-mode: t

  file-name-shadow-mode: t

  global-font-lock-mode: t

  font-lock-mode: t

  blink-cursor-mode: t

  auto-composition-mode: t

  auto-encryption-mode: t

  auto-compression-mode: t

  column-number-mode: t

  line-number-mode: t

Recent messages:

Creating group entries...done

Creating customization items ...done

Resetting customization items...done

Creating customization setup...done

Auto-saving...done

Save all settings in this buffer? (y or n) y

Saving file /home/jso/.emacs.d/init.el...

Wrote /home/jso/.emacs.d/init.el [2 times]

Mark set [4 times]

Buffer *unsent mail to bug-gnu-emacs@gnu.org* modified; kill anyway? (y or n) y

Load-path shadows:

/home/jso/.emacs.d/elpa/cmake-mode-20150120.620/cmake-mode hides /usr/share/emacs/site-lisp/cmake-mode

/usr/share/emacs/site-lisp/rst hides /usr/share/emacs/25.0.50/lisp/textmodes/rst

/usr/share/emacs/site-lisp/dictionaries-common/ispell hides /usr/share/emacs/25.0.50/lisp/textmodes/ispell

/usr/share/emacs/site-lisp/dictionaries-common/flyspell hides /usr/share/emacs/25.0.50/lisp/textmodes/flyspell

~/.emacs.d/cc-mode/cc-guess hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-guess

~/.emacs.d/cc-mode/cc-vars hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-vars

~/.emacs.d/cc-mode/cc-mode hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-mode

~/.emacs.d/cc-mode/cc-bytecomp hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-bytecomp

~/.emacs.d/cc-mode/cc-styles hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-styles

~/.emacs.d/cc-mode/cc-fonts hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-fonts

~/.emacs.d/cc-mode/cc-menus hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-menus

~/.emacs.d/cc-mode/cc-cmds hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-cmds

~/.emacs.d/cc-mode/cc-align hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-align

~/.emacs.d/cc-mode/cc-engine hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-engine

~/.emacs.d/cc-mode/cc-defs hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-defs

~/.emacs.d/cc-mode/cc-awk hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-awk

~/.emacs.d/cc-mode/cc-langs hides /usr/share/emacs/25.0.50/lisp/progmodes/cc-langs

/usr/share/emacs/site-lisp/latex-cjk-thai/thai-word hides /usr/share/emacs/25.0.50/lisp/language/thai-word

~/.emacs.d/cc-mode/cc-compat hides /usr/share/emacs/25.0.50/lisp/obsolete/cc-compat

Features:

(uudecode uce supercite regi spam-report spam spam-stat gnus-uu yenc

gnus-msg gnus-art mm-uu mml2015 mm-view mml-smime smime dig smtpmail

sieve-manage rmail pop3 mspools mh-e mh-compat mh-acros mh-buffers

mh-loaddefs mairix mailclient browse-url mailalias mail-hist imap

hashcash gnus-dired fortune feedmail eudc-vars ecomplete binhex apropos

footnote shadow sort mail-extr emacsbug sendmail mm-archive url-handlers

eieio-opt speedbar sb-image ezimage dframe pcmpl-unix em-unix em-term

em-script em-prompt em-ls em-hist em-pred em-glob em-dirs em-cmpl

em-basic em-banner em-alias magit-blame cmake-mode ruler-mode hl-line

hexl smerge-mode ert timezone texinfo toolbar-x prv-emacs reporter

desktop frameset context plain-tex latex tex-style tex-buf tex dbus xml

crm tempo company-dabbrev hippie-exp debug json irony-cdb jedi-core

python-environment epc ctable concurrent deferred ediff-merg ediff-wind

ediff-diff ediff-mult ediff-help ediff-init ediff-util ediff dired-x

org-rmail org-mhe org-irc org-info org-gnus org-docview org-bibtex

org-bbdb org-w3m rng-loc rng-uri rng-parse rng-match rng-dt rng-util

rng-pttrn nxml-parse nxml-ns nxml-enc xmltok nxml-util ox-latex

ox-icalendar ox-html table ox-ascii ox-publish ox org-element org-table

org-agenda esh-var esh-io esh-cmd esh-opt esh-ext esh-proc esh-arg

esh-groups eshell esh-module esh-mode esh-util doc-view jka-compr

image-mode bibtex org-id org org-macro org-footnote org-pcomplete

org-list org-faces org-entities org-version ob-python ob-emacs-lisp

org-loaddefs cal-menu calendar cal-loaddefs gnus-sum gnus-group

gnus-undo gnus-start gnus-cloud nnimap nnmail mail-source utf7 netrc

nnoo parse-time gnus-spec gnus-int gnus-range gnus-win gnus gnus-ems

nnheader ob-octave noutline outline calc calc-loaddefs calc-macs ob

ob-tangle ob-ref ob-lob ob-table ob-exp org-src ob-keys ob-comint

ob-core ob-eval org-compat org-macs rx auto-complete rtags popup repeat

bookmark company-template warnings autoload lisp-mnt tar-mode url-http

url-gw url-cache url-auth url url-proxy url-privacy url-expand

url-methods url-history url-cookie url-domsuf url-util url-parse

url-vars mailcap sgml-mode make-mode novice dirtrack sql socks

network-stream nsm starttls tls rlogin proced metamail gud flyspell

ispell pp cus-edit wid-edit magit-key-mode magit view grep epa derived

epg git-rebase-mode git-commit-mode log-edit message dired rfc822 mml

mml-sec mm-decode mm-bodies mm-encode mail-parse rfc2231 rfc2047 rfc2045

ietf-drums mailabbrev mail-utils gmm-utils mailheader pcvs-util xterm

conf-mode add-log sh-script smie executable thingatpt misearch

multi-isearch vc vc-dispatcher vc-git diff-mode cpp cc-mode cc-fonts

cc-awk cc-guess cc-menus cc-cmds cc-styles cc-align cc-engine cc-langs

cc-vars cc-defs cc-bytecomp tabify man tramp-cache elisp-slime-nav

help-mode company-cmake company-irony irony-completion irony-snippet

server term disp-table ehelp powerline time cl windmove ido tramp

tramp-compat auth-source gnus-util mm-util mail-prsvr password-cache

tramp-loaddefs trampver shell pcomplete format-spec advice help-fns

irony find-func company easy-mmode cl-macs ggtags etags xref eieio

eieio-core cl-generic byte-opt gv bytecomp byte-compile cl-extra seq

cconv compile comint ansi-color ewoc edmacro kmacro cl-loaddefs pcase

cl-lib finder-inf tex-site info easymenu package epg-config saveplace

leuven-theme xt-mouse winner ring which-func imenu paren autorevert

filenotify cus-start cus-load mule-util time-date tooltip eldoc electric

uniquify ediff-hook vc-hooks lisp-float-type mwheel x-win x-dnd tool-bar

dnd fontset image regexp-opt fringe tabulated-list newcomment elisp-mode

lisp-mode prog-mode register page menu-bar rfn-eshadow timer select

scroll-bar mouse jit-lock font-lock syntax facemenu font-core frame cham

georgian utf-8-lang misc-lang vietnamese tibetan thai tai-viet lao

korean japanese hebrew greek romanian slovak czech european ethiopic

indian cyrillic chinese case-table epa-hook jka-cmpr-hook help simple

abbrev minibuffer cl-preloaded nadvice loaddefs button faces cus-face

macroexp files text-properties overlay sha1 md5 base64 format env

code-pages mule custom widget hashtable-print-readable backquote

make-network-process dbusbind gfilenotify dynamic-setting

system-font-setting font-render-setting move-toolbar gtk x-toolkit x

multi-tty emacs)

Memory information:

((conses 16 5101727 455519)

 (symbols 48 74114 0)

 (miscs 40 12397 14840)

 (strings 32 207635 114021)

 (string-bytes 1 6335085)

 (vectors 16 79150)

 (vector-slots 8 2022361 83492)

 (floats 8 982 3084)

 (intervals 56 838741 22842)

 (buffers 976 184)

 (heap 1024 216591 159638))