Microsoft is working on an unsealed Open World AAA title
The news comes from the LinkedIn profile of Dave Mongan, Narrative Director at XGS whose role is to oversee all the narrative elements of the titles being developed at external studios. The fact that it is an XGS Publishing game indicates that it is a different game from those already known but not yet announced, such as the new title of The Initiative or the ambitious RPG of inXile; in this case we are talking about a game made by a developer outside of Microsoft, but produced by Microsoft itself.
A full-fledted first party game, although often the press and fans are used to improperly calling these titles "second party", due to the fact that the production is internal to Microsoft but the development is by an external studio. In addition to the two recent titles already mentioned, other examples of similar productions are Quantum Break, ReCore, and Sunset Overdrive.
We hope to find out what game it is soon, perhaps on the occasion of The Game Awards event scheduled for December 11th!