.inputrc (bash)
set convert-meta off set meta-flag on set output-meta on
.cshrc (tcsh)
set dspmbyte=utf8
.vimrc
:set enc=utf-8 :set fenc=utf-8
And don't forget 'ls -w' or 'ls -v' to display files and directories.
Preferences: Uncheck 'Emulation > Escape non-ASCII characters';
More at Apple Support - Topic: Displaying foreign characters in the Terminal command line.