UTF-8 characters do not display correctly in the interactive line editor

Binary package hint: zsh

This bug exists in standard Ubuntu 6.06.1 with zsh as added-on application. No editing to any startup-files has been done.

When running a normal zsh-session (zsh 4.2.5) in GnomeTerminal (2.14.2) the euro-character is not echoed correctly on the command line. Instead, this odd-looking string appears: �^¬

Also some other characters create similar-looking output. This also happens in an xterm-window.

When typing the same characters in a bash-session everything is as it should.

Running the command locale gives the following output:

LANG=sv_FI.UTF-8@euro
LANGUAGE=sv_FI.UTF-8@euro
LC_CTYPE="sv_FI.UTF-8@euro"
LC_NUMERIC="sv_FI.UTF-8@euro"
LC_TIME="sv_FI.UTF-8@euro"
LC_COLLATE="sv_FI.UTF-8@euro"
LC_MONETARY="sv_FI.UTF-8@euro"
LC_MESSAGES="sv_FI.UTF-8@euro"
LC_PAPER="sv_FI.UTF-8@euro"
LC_NAME="sv_FI.UTF-8@euro"
LC_ADDRESS="sv_FI.UTF-8@euro"
LC_TELEPHONE="sv_FI.UTF-8@euro"
LC_MEASUREMENT="sv_FI.UTF-8@euro"
LC_IDENTIFICATION="sv_FI.UTF-8@euro"
LC_ALL=