if you click on it, the link in your browser’s address bar will more likely render properly.
The default on librewolf (and possibly Firefox?) is to show the punycode in the URL bar since rendering the international characters can be used as a way to create phishing URLs that look similar (and sometimes identical) to characters in the latin alphabet. This is a very dangerous feature since the URL bar of the phishing site can look identical to the real website address.
To enable the display of the alternate character sets represented by the punycode URLs, you have to set network.IDN_show_punycode to false in about:config.