jQueryUI autocomplete - encoding problem

I have problem with encoding in jQueryUI Autocomplete. Server side application is PHP and send reply for this query with headers:

Content-Type: application/json, charset=UTF-8

Here is autocomplete code:

$('#city').autocomplete({
    source: 'ajax_get_cities.html',
    dataType: "json",
    minLength:3
});

When I type: kra (expected result is: Kraków) I get reply (copied from Firebug raw reply):

[{"city":"Krak\u00f3w"}]

and autocomplete doesn't display this result.

Database table, field, connection, PHP file, all is UTF-8.

Where is problem?

Update

This is server side problem, PHP application based on KohanaPHP 2.3.4 framework. Here is code to get and display result:

header('Content-Type: application/json, charset=UTF-8');
$开发者_高级运维mModel = new Partners_Model();
$str = $this->input->get('term', true);
$aCities = $mModel->getCitiesAjax($str);
echo json_encode($aCities);

When I disply $aCities array then I get correct string.

The local data can be a simple Array of Strings, or it contains Objects for each item in the array, with either a label or value property or both.

add label property to your json response:

[{"label":"Krak\u00f3w"}]

DOCS: Autocomplete Widget | jQuery UI API Documentation - option "source"

add this to your autocomplete:

    contentType: "application/json; charset=utf-8"