Feature request: auto-retry on API 500 errors

Problem

When the Anthropic API returns 500 errors during an active incident, Claude Code hangs silently with no visual feedback and no automatic retry. The user experience is that Claude appears frozen — there's no indication that anything went wrong or that the request failed. The user has to manually press Escape and re-trigger their prompt.

During today's incident (Feb 25, 2026 — "Elevated error rates across multiple models"), this happened repeatedly across a working session, causing significant disruption.

Proposed Solution

1. Auto-retry with backoff — On 500 errors, automatically retry 2-3 times with exponential backoff (e.g., 2s, 4s, 8s) before surfacing the failure to the user.
2. Visible status indicator — Show something in the UI when a request fails and is being retried (e.g., "API error, retrying...") so the user knows Claude isn't just sitting there.
3. Configurable — Allow users to set retry count and backoff in settings if desired.

Current Workaround

Press Escape to cancel the stuck request, then re-send manually.

Environment

• Claude Code CLI
• Windows 11
• Model: claude-opus-4-6