REST API payload max size with compression

We have a regional REST API in API gateway that uses content encoding. The encoding limit is set at 5 MB. The encoding is working but it is not affecting the 10 MB payload max size. Meaning that when the response's un-compressed size is larger than 10 MB while the compressed size is about 500 kb, the query fails. "Execution failed due to configuration error: Integration response of reported length 10548739 is larger than allowed maximum of 10485760 bytes."

Is this a recent bug/feature because I tested out API calls with payloads larger than 10 MB with compressed size < 10 MB and it was working?