diff --git a/cosmic-icons b/cosmic-icons
index 52520957..343c007f 160000
--- a/cosmic-icons
+++ b/cosmic-icons
@@ -1 +1 @@
-Subproject commit 5252095787cc96e2aed64604158f94e450703455
+Subproject commit 343c007f37cd71716e68f01c43ecf2764b7f7c47
diff --git a/iced b/iced
index e891f34b..d12bb8e0 160000
--- a/iced
+++ b/iced
@@ -1 +1 @@
-Subproject commit e891f34b3224b25fc4bdf286b3f9dba26c8abe5b
+Subproject commit d12bb8e056712ab87efbdd4296261331772ec413
diff --git a/src/widget/popover.rs b/src/widget/popover.rs
index b9704244..fb7fea66 100644
--- a/src/widget/popover.rs
+++ b/src/widget/popover.rs
@@ -157,9 +157,17 @@ where
     ) {
         if self.popup.is_some() {
             if self.modal {
-                if matches!(event, Event::Mouse(_) | Event::Touch(_)) {
-                    shell.capture_event();
-                    return;
+                match event {
+                    Event::Mouse(_) | Event::Touch(_) => {
+                        shell.capture_event();
+                        return;
+                    }
+                    // app-level keyboard navigation (Tab focus cycling, Escape)
+                    // still receives keyboard events
+                    Event::Keyboard(_) => {
+                        return;
+                    }
+                    _ => {}
                 }
             } else if let Some(on_close) = self.on_close.as_ref()
                 && matches!(
diff --git a/src/widget/toaster/widget.rs b/src/widget/toaster/widget.rs
index 03bdf1bd..63c1c6a2 100644
--- a/src/widget/toaster/widget.rs
+++ b/src/widget/toaster/widget.rs
@@ -4,7 +4,7 @@
 use iced::{Limits, Size};
 use iced_core::layout::Node;
 
-use iced_core::event::Event;
+use iced_core::event::{self, Event};
 use iced_core::renderer::{self};
 use iced_core::widget::Operation;
 use iced_core::widget::tree::Tree;
@@ -142,23 +142,26 @@ where
         viewport: &Rectangle,
         translation: Vector,
     ) -> Option<overlay::Element<'b, Message, Theme, Renderer>> {
-        //TODO: this hides the overlay of the content during the toast
+        let (content_state, toasts_state) = state.children.split_at_mut(1);
+        let content = self.content.as_widget_mut().overlay(
+            &mut content_state[0],
+            layout,
+            renderer,
+            viewport,
+            translation,
+        );
         if self.is_empty {
-            self.content.as_widget_mut().overlay(
-                &mut state.children[0],
-                layout,
-                renderer,
-                viewport,
-                translation,
-            )
-        } else {
-            let _bounds = layout.bounds();
-
-            Some(overlay::Element::new(Box::new(ToasterOverlay::new(
-                &mut state.children[1],
-                &mut self.toasts,
-            ))))
+            return content;
         }
+        // keep the content's overlays (e.g. popovers, menus) visible while a toast is shown
+        let toaster = overlay::Element::new(Box::new(ToasterOverlay::new(
+            &mut toasts_state[0],
+            &mut self.toasts,
+        )));
+        Some(match content {
+            Some(content) => overlay::Group::with_children(vec![content, toaster]).overlay(),
+            None => toaster,
+        })
     }
 
     fn drag_destinations(