vs code terminal open folder in current window
code -r .
vscode terminal position
As of October 2018 (version 1.29) the button in @mvvijesh's answer no longer exists.
You now have 2 options. Right click the panel's toolbar (nowhere else on the panel will work) and choose "move panel right/bottom":
Or choose "View: Toggle Panel Position" from the command palette.
Source: VSCode update notes: https://code.visualstudio.com/updates/v1_29#_panel-position-button-to-context-menu
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