diff --git a/vibn-frontend/components/vibn-chat/chat-panel.tsx b/vibn-frontend/components/vibn-chat/chat-panel.tsx
index 1411495..2ad3967 100644
--- a/vibn-frontend/components/vibn-chat/chat-panel.tsx
+++ b/vibn-frontend/components/vibn-chat/chat-panel.tsx
@@ -1290,6 +1290,7 @@ export function ChatPanel({
 
       let assistantContent = "";
       let lastKind = "";
+      let currentThoughtText = "";
       const assistantMsg: Message = { role: "assistant", content: "" };
       let msgIndex = -1;
 
@@ -1434,6 +1435,16 @@ export function ChatPanel({
               });
             } else if (ev.type === "thinking_delta" && ev.text) {
               lastKind = "thought";
+              currentThoughtText += ev.text;
+              
+              // Extract the latest bold heading to display in the spinner label
+              const matches = [...currentThoughtText.matchAll(/\*\*([^*]+)\*\*/g)];
+              if (matches.length > 0) {
+                setCurrentPhaseLabel(matches[matches.length - 1][1].trim() + "...");
+              } else {
+                setCurrentPhaseLabel("Thinking...");
+              }
+
               setMessages((prev) => {
                 const next = [...prev];
                 if (msgIndex >= 0 && next[msgIndex]) {
@@ -2090,32 +2101,7 @@ export function ChatPanel({
           </div>
         )}
 
-        {/* Action Status Bar anchored above composer */}
-        {sending && currentPhaseLabel && (
-          <div
-            style={{
-              display: "flex",
-              alignItems: "center",
-              gap: 8,
-              padding: "4px 8px 10px",
-              marginLeft: 4,
-            }}
-          >
-            <Loader2
-              className="animate-spin"
-              style={{ width: 14, height: 14, color: "#8b5cf6" }}
-            />
-            <span
-              style={{
-                fontSize: "0.75rem",
-                fontWeight: 500,
-                color: "#71717a",
-              }}
-            >
-              {currentPhaseLabel}
-            </span>
-          </div>
-        )}
+
 
         <ProjectPreviewChatInputWrap unifiedShell={unifiedProjectShell}>
           {(selectToggle) => (