mercurial/dispatch.py

--- a/mercurial/dispatch.py	Mon Aug 08 17:27:49 2022 +0200
+++ b/mercurial/dispatch.py	Wed Aug 10 15:01:50 2022 -0400
@@ -952,14 +952,22 @@
 
     Takes paths in [cwd]/.hg/hgrc into account."
     """
+    try:
+        cwd = encoding.getcwd()
+    except OSError as e:
+        raise error.Abort(
+            _(b"error getting current working directory: %s")
+            % encoding.strtolocal(e.strerror)
+        )
+
+    # If using an alternate wd, temporarily switch to it so that relative
+    # paths are resolved correctly during config loading.
+    oldcwd = None
     if wd is None:
-        try:
-            wd = encoding.getcwd()
-        except OSError as e:
-            raise error.Abort(
-                _(b"error getting current working directory: %s")
-                % encoding.strtolocal(e.strerror)
-            )
+        wd = cwd
+    else:
+        oldcwd = cwd
+        os.chdir(wd)
 
     path = cmdutil.findrepo(wd) or b""
     if not path:
@@ -979,6 +987,9 @@
             lui.readconfig(os.path.join(path, b".hg", b"hgrc"), path)
             lui.readconfig(os.path.join(path, b".hg", b"hgrc-not-shared"), path)
 
+    if oldcwd:
+        os.chdir(oldcwd)
+
     return path, lui