Inproper encoding?

Paste this into Powershell Prompt (or ISE) and Char returns "å". Save this as a .ps1 file and executing it and it returns "A¥".

~~~~
$Char = "å"
$Char
~~~~

I've tried swathing the encoding but nothing I have tried has worked so far. It doesn't make sense why PowerShell.exe handles this any differently then a script does.

Any ideas???