[BUG] Cyrillic text clipboard encoding broken in v2.1.196

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?

• OS: macOS (MacBook Pro)
• Terminal: Cursor integrated terminal via SSH to Debian VPS
• Version: 2.1.196
• Problem: Cyrillic text displays correctly in terminal but copies to clipboard as garbled Latin-1 (e.g. "Привет" "Ã^PÃ^QÃ^P¸Ã^P²Ã^PµÃ^Q")
• Works fine: regular terminal commands (echo "Привет") copy correctly
• Was working before recent update

What Should Happen?

Cyrillic text copied from Claude Code output should paste correctly as UTF-8 Unicode characters (e.g. "Привет мир"), the same way regular terminal output copies correctly.

Error Messages/Logs

Steps to Reproduce

1. Connect to a Debian VPS via SSH in Cursor's integrated terminal (macOS)
2. Run claude to start Claude Code
3. Ask anything in Russian or any Cyrillic language
4. Select and copy Claude's response text
5. Paste anywhere (browser, text editor, another terminal)

Note: Regular terminal output (echo "Привет") copies correctly from the same terminal session.

Claude Model

None

Is this a regression?

Yes, this worked in a previous version

Last Working Version

_No response_

Claude Code Version

Version: 2.1.196

Platform

Anthropic API

Operating System

Ubuntu/Debian Linux

Terminal/Shell

Cursor

Additional Information

_No response_