VS Code Foundry Toolkit – Subscription selection stuck in loop, cannot proceed to resource group step

[prteotia]

While creating a Hosted Agent using "Microsoft Foundry Toolkit for VS Code", the setup flow gets stuck at the Azure subscription selection step.

After selecting a subscription, the UI repeatedly prompts to select the subscription again and does not proceed to the next step (resource group selection).

This blocks completing the Hosted Agent setup from VS Code.

Steps to Reproduce

1. Open VS Code
2. Open Command Palette (Ctrl + Shift + P)
3. Run: Microsoft Foundry: Create new Hosted Agent
4. Select framework and language
5. When prompted to select Azure subscription:
   • Select valid subscription

Expected:
→ It should proceed to resource group selection

Actual:
→ It keeps asking to select subscription again (loop)

Environment
VS Code Version: (Help → About)
Extension: Foundry Toolkit for VS Code
Extension Version: 1.4.2
OS: Windows
Azure Account: Work account

Additional Info

• Tried az logout / login
• Cleared Azure cache
• Restarted machine
• Issue persists
  

[microsoft-github-policy-service]

Thank you for contacting us! Any issue or feedback from you is quite important to us. We will do our best to fully respond to your issue as soon as possible. Sometimes additional investigations may be needed, we will usually get back to you within 2 days by adding comments to this issue. Please stay tuned.