diff --git a/packages/coding-agent/CHANGELOG.md b/packages/coding-agent/CHANGELOG.md
index 9337ac979..b513e7a2f 100644
--- a/packages/coding-agent/CHANGELOG.md
+++ b/packages/coding-agent/CHANGELOG.md
@@ -39,6 +39,7 @@
 - Fixed Windows paths being compared case-sensitively. When the working directory and home directory differed only in drive-letter casing (`c:\Users\me` vs `C:\Users\me`), skills in `~/.agents/skills` loaded twice, as project and user skills, and were reported as name collisions. The same mismatch also re-asked for saved project trust, hid sessions in a custom session directory from `--continue` and `/resume`, and stopped `pi remove` from matching configured local packages ([#10488](https://github.com/earendil-works/pi/issues/10488))
 - Fixed paths next to the home directory being shown with a broken `~` prefix, for example `/home/me2/project` shown as `~2/project` when home is `/home/me`
 - Fixed `pi mcp login -l` and `pi mcp logout -l` failing with `Unknown option --local.` although `pi mcp add` and `pi mcp remove` accept `-l`. With `-l`, they now require the server to be a project server. Unknown options are now reported as typed, and a mistyped server name gets a suggestion, for example `Did you mean "gurker"?`
+- Fixed `pi update` naming pnpm for installs that only live under `PNPM_HOME`, for example a wrapper under `$PNPM_HOME/global-nub/`. pi said "not managed by a global pnpm install"; it now names the package manager only when that manager owns the install ([#7756](https://github.com/earendil-works/pi/issues/7756))
 
 ## [1.4.0] - 2026-10-21
 
diff --git a/packages/coding-agent/src/config.ts b/packages/coding-agent/src/config.ts
index 61dd63f38..381747620 100644
--- a/packages/coding-agent/src/config.ts
+++ b/packages/coding-agent/src/config.ts
@@ -345,11 +345,10 @@ export function getSelfUpdateUnavailableInstruction(
 		return `Download from: https://github.com/earendil-works/pi/releases/latest`;
 	}
 	const command = getSelfUpdateCommandForMethod(method, packageName, target, npmCommand);
-	if (command) {
-		if (isManagedByGlobalPackageManager(method, packageName, npmCommand) && !isSelfUpdatePathWritable()) {
-			return `This installation is managed by a global ${method} install, but the install path is not writable. Update it yourself with: ${command.display}`;
-		}
-		return `This installation is not managed by a global ${method} install. Update it with the package manager, wrapper, or source checkout that provides it.`;
+	// Path-based detection also matches installs that only live under a package manager's directory,
+	// such as a wrapper under PNPM_HOME, so name the package manager only when it owns the install.
+	if (command && isManagedByGlobalPackageManager(method, packageName, npmCommand) && !isSelfUpdatePathWritable()) {
+		return `This installation is managed by a global ${method} install, but the install path is not writable. Update it yourself with: ${command.display}`;
 	}
 	return `Update ${target.installSpec} using the package manager, wrapper, or source checkout that provides this installation.`;
 }
diff --git a/packages/coding-agent/test/config.test.ts b/packages/coding-agent/test/config.test.ts
index ff652cae3..236e26986 100644
--- a/packages/coding-agent/test/config.test.ts
+++ b/packages/coding-agent/test/config.test.ts
@@ -182,6 +182,33 @@ describe("detectInstallMethod", () => {
 		);
 	});
 
+	// Issue #7756
+	test("does not name pnpm for unmanaged installs under PNPM_HOME", () => {
+		tempDir = mkdtempSync(join(tmpdir(), "pi-pnpm-home-"));
+		const packageDir = join(
+			tempDir,
+			".local",
+			"share",
+			"pnpm",
+			"global-nub",
+			"5",
+			"node_modules",
+			"@earendil-works",
+			"pi-coding-agent",
+		);
+		mkdirSync(packageDir, { recursive: true });
+		process.env.PI_PACKAGE_DIR = packageDir;
+		process.env.PATH = "";
+		process.argv[1] = join(packageDir, "dist", "cli.js");
+		setExecPath(join(packageDir, "dist", "cli.js"));
+
+		expect(detectInstallMethod()).toBe("pnpm");
+		expect(getSelfUpdateCommand("@earendil-works/pi-coding-agent")).toBeUndefined();
+		expect(getSelfUpdateUnavailableInstruction("@earendil-works/pi-coding-agent")).toBe(
+			"Update @earendil-works/pi-coding-agent using the package manager, wrapper, or source checkout that provides this installation.",
+		);
+	});
+
 	test("self-updates npm installs from custom prefixes", () => {
 		const { prefix } = createNpmPrefixInstall();