Recursive use of type-in-type results in infinite loop

Typechecking this module results in an infinite loop:

{-# LANGUAGE DataKinds #-}
{-# LANGUAGE ExistentialQuantification #-}
{-# LANGUAGE KindSignatures #-}
{-# LANGUAGE TypeInType #-}
module X where

data V a
data T = forall (a :: S). MkT (V a)
data S = forall (a :: T). MkS (V a)

There's a mutually recursive reference so it should be rejected but maybe the check is not happening early enough (or the existing check is only for self-reference.)

Trac metadata

Trac field	Value
Version	8.0.1
Type	Bug
TypeOfFailure	OtherFailure
Priority	normal
Resolution	Unresolved
Component	Compiler (Type checker)
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