[BUG] Up/down arrow key functions in context window

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

Up/down arrow no longer moves cursor within multi-line input — used to cycle history when empty, move cursor when text present, now always cycles history regardless.

What Should Happen?

Up/down arrow should cycle history when empty, move cursor when text present, NOT do anything when text is present

Error Messages/Logs

Steps to Reproduce

just type multi line prompt in the context window and use up/down arrow keys

Claude Model

Not sure / Multiple models

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

2.1.156 (Claude Code)

Platform

Anthropic API

Operating System

macOS

Terminal/Shell

Terminal.app (macOS)

Additional Information

_No response_