As per the discussion in issue #17960, I'm going to put together a short PEP about this topic for Python 3.7 that will better specify the expected behaviour of locals() and frame.f_locals.

That will be a combination of making the status quo official, proposing some changes, and asking Guido for a design decision.

Documenting the status quo: make the current behaviour at module scope, class scope, and the corresponding behaviours of exec and eval officially part of the status quo

Proposing a change: replacing the current LocalsToFast approach with a custom write-through proxy type that updates the locals array and nonlocal cell variables immediately whenever frame.f_locals is modified (this is the part that should fix the bug reported in this issue)

Requesting a design decision: whether locals() at function(/generator/coroutine) scope should return:
- a direct reference to the write-through proxy
- a live read-only dict-proxy (ala class __dict__ attributes)
- a point-in-time snapshot (i.e. copying the namespace)