Background Blur turns grey in UE 5.7

Hi everyone,

After updating to Unreal Engine 5.7 I noticed, that the BackgroundBlur widget no longer works correctly. As soon as the BLur strength is set above 0, the widget becomes grey instead of blurring the bg.
The Blur widget covers the entire screen, it worked corectly in previous UE versions.
I had to update it to 5.7 because older engine versions require older Xcode versions, and with my current Xcode 26.2 Unreal wouldn’t allow me to package the project.
Has anyone had this issue in 5.7 or knows a workaround?