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I was under the impression that Copilot does not use context from other files, only the current file. Is that correct? Is there documentation about what other files Copilot uses for context if not?

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It does use the neighboring files for context. Check out the FAQ (https://copilot.github.com/#faq-what-context-does-github-cop...)

I don't have official confirmation, but my experience is that at least the IntelliJ plugin version 100% seems to be using or remembering context from other parts of the project. It will know how to complete pieces of code in a brand new file, in ways that are very peculiar to my specific project.

I think IntelliJ generally has the feature to autocomplete code in markdown code blocks based on the current project. So that in itself is not a Copilot feature.

It's really useful because it will even understand Angular2 codebases and autocomplete custom components in html snippets.

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