After I upgraded my Mac to Snow Leopard, Capistrano deployments with key forwarding stopped working. I started getting a following error:
Permission denied (publickey)
My fellow Bambinos enlightened me that key forwarding was switched off by default in Snow Leopard. The solution was to change the following two lines in /etc/ssh_config:
#Host *
#ForwardAgent no
to the following two lines:
Host *
ForwardAgent yes
Unfortunately after this change I was still getting Permission denied (publickey) error.
Today I found the root cause. My ssh key was not added to the authentication agent so the key was not forwarded. The solution was to execute the following command:
ssh-add ~/.ssh/id_dsa
(or ssh-add ~/.ssh/id_rsa if you use rsa key)
Now everything works fine.