This issue is not limited to labels. I have faced this issue in multiple areas. I have broken my head multiple times on configs that never work immediately. After you accept the defeat and come next day, it will automatically start working.
I recall reading somewhere that some values are cached in the CSU side as well as Modern POS. In some articles MS was recommending that Commerce Scale Unit application pool should be recycled if you can't wait for the cache to expire automatically. If you have self hosted Commerce scale unit, you can do this by resetting IIS. If it is cloud hosted, try restart Commerce scale Unit from LCS.
Also, make sure that no instances of DLLHost.exe is running in Task Manager.
