diff --git a/VERSION b/VERSION
index c3d16c1..884e960 100644
--- a/VERSION
+++ b/VERSION
@@ -1 +1 @@
-0.17.2
+0.17.3
diff --git a/web/src/lib/components/ChatThread.svelte b/web/src/lib/components/ChatThread.svelte
index cfde1da..909ca2a 100644
--- a/web/src/lib/components/ChatThread.svelte
+++ b/web/src/lib/components/ChatThread.svelte
@@ -404,11 +404,31 @@
             <button
               class="ml-1 text-muted-foreground hover:text-foreground"
               onclick={() => onDismissError(err.id)}
-              aria-label="Dismiss">×</button
+              aria-label="Dismiss">×</button>
             >
           </div>
         </div>
       {/each}
+
+      {#if working && !streaming}
+        <!-- Background/autonomous turn in progress (no live stream to watch):
+             keep the composer open so the operator can queue a follow-up
+             (plan 2026-08-03 F1/F2). Lives in the message pane (alongside the
+             connection/error banners) so it consumes transcript space, NOT the
+             input pane's fixed height — otherwise appearing/disappearing would
+             clip the textarea and force a resize. Terminal status strip:
+             spinner + fg label + primary-tinted hairline border, aligned to the
+             textarea column. -->
+        <div class="mx-auto w-full max-w-3xl px-4">
+          <div class="composer-status mb-2">
+            <Spinner class="size-3 shrink-0 text-primary" />
+            <span class="composer-status-label">Working</span>
+            <span class="composer-status-text"
+              >message will queue — runs when Nomos is free</span
+            >
+          </div>
+        </div>
+      {/if}
     </Pane>
 
     <Pane bind:size={inputSize} minSize={inputMinSize} maxSize={45} class="flex flex-col">
@@ -416,22 +436,6 @@
         class="flex h-full min-h-0 flex-col border-t bg-card/50 p-3 input-ornament relative"
         bind:this={inputWrapperRef}
       >
-        {#if working && !streaming}
-          <!-- Background/autonomous turn in progress (no live stream to watch):
-               keep the composer open so the operator can queue a follow-up
-               (plan 2026-08-03 F1/F2). Styled as a terminal status strip that
-               mirrors AgentTrace's running idiom (spinner + fg label + a
-               primary-tinted hairline border) and aligns to the textarea's
-               column, so it reads as part of the working state rather than a
-               floating footnote. -->
-          <div class="composer-status mx-auto mb-2 w-full max-w-3xl">
-            <Spinner class="size-3 shrink-0 text-primary" />
-            <span class="composer-status-label">Working</span>
-            <span class="composer-status-text"
-              >message will queue — runs when Nomos is free</span
-            >
-          </div>
-        {/if}
         <form
           class="relative mx-auto flex h-full w-full max-w-3xl"
           onsubmit={(e) => {