character encoding problem with rewrite rule

i'm really stumped with a problem caused by using a rewrite rule in an htaccess file

if i put this

<?php
echo "£';
?>

it echos £

if i use a rewrite to another file and put the same code in that file if echos £

this isnt the actual problem but a much simplified example

any ideas would be much appreciated

 

Whats that file going to be used for?
If its displaying HTML, have you try outputting as an entity, i.e &pound;

Theres a full list of entities here
http://www.cookwood.com/html/extras/entities.html