Since I have now tried several different things in response to postings, on different levels in the thread, I have decided to make a summary of what has happened.

I have gone back to my original code, but tried 'ISO-8859-15' instead. The resulting character is utf-8 character 189.

I then tried encoding cp1252, which transformed utf8 8364 in to whitespace.

It would appear that I may require a different encoding, one which is like ISO-8859-15 for characters like ø, but with a different euro number.

In the meantime I've also been pursuing the option of using ISO-8859-15 and manually transforming the euro symbol with a regex, but unfortunately the utf-8 euro symbol is not picked up in the first regex, with or without utf8 pragma on. I have verified that the symbol in my template is the utf-8 euro symbol by viewing it in an xhtml page with charset utf-8.