Doesn't work in MacOS Catalina in iterm2 and tmux next-3.1

[subtleseeker]

Configuration OS: MacOS Catalina iterm2 with shell-integration installed tmux version: next-3.1

Current behaviour: Scrolling from trackpad scrolls the history in the prompt

These are my mouse bindings:

$ tmux list-keys -T root
bind-key -T root MouseDown1Pane       select-pane -t = \; send-keys -M
bind-key -T root MouseDown1Status     select-window -t =
bind-key -T root MouseDown3Pane       if-shell -F -t = "#{||:#{mouse_any_flag},#{pane_in_mode}}" "select-pane -t=; send-keys -M" "display-menu -t= -xM -yM -T \"#[align=centre]#{pane_index} (#{pane_id})\"  '#{?mouse_word,Search For #[underscore]#{=/9/...:mouse_word},}' 'C-r' {copy-mode -t=; send -Xt= search-backward \"#{q:mouse_word}\"} '#{?mouse_word,Type #[underscore]#{=/9/...:mouse_word},}' 'C-y' {send-keys -l -- \"#{q:mouse_word}\"} '#{?mouse_word,Copy #[underscore]#{=/9/...:mouse_word},}' 'c' {set-buffer -- \"#{q:mouse_word}\"} '#{?mouse_line,Copy Line,}' 'l' {set-buffer -- \"#{q:mouse_line}\"} '' 'Horizontal Split' 'h' {split-window -h} 'Vertical Split' 'v' {split-window -v} '' 'Swap Up' 'u' {swap-pane -U} 'Swap Down' 'd' {swap-pane -D} '#{?pane_marked_set,,-}Swap Marked' 's' {swap-pane} '' 'Kill' 'X' {kill-pane} 'Respawn' 'R' {respawn-pane -k} '#{?pane_marked,Unmark,Mark}' 'm' {select-pane -m} '#{?window_zoomed_flag,Unzoom,Zoom}' 'z' {resize-pane -Z}"
bind-key -T root MouseDown3Status     display-menu -T "#[align=centre]#{window_index}:#{window_name}" -t = -x W -y S "Swap Left" l "swap-window -t:-1" "Swap Right" r "swap-window -t:+1" "#{?pane_marked_set,,-}Swap Marked" s swap-window  Kill X kill-window Respawn R "respawn-window -k" "#{?pane_marked,Unmark,Mark}" m "select-pane -m" Rename n "command-prompt -I \"#W\" \"rename-window -- '%%'\""  "New After" w "new-window -a" "New At End" W new-window
bind-key -T root MouseDown3StatusLeft display-menu -T "#[align=centre]#{session_name}" -t = -x M -y S Next n "switch-client -n" Previous p "switch-client -p"  Renumber N "move-window -r" Rename n "command-prompt -I \"#S\" \"rename-session -- '%%'\""  "New Session" s new-session "New Window" w new-window
bind-key -T root MouseDrag1Pane       if-shell -F -t = "#{mouse_any_flag}" "if -Ft= \"#{pane_in_mode}\" \"copy-mode -M\" \"send-keys -M\"" "copy-mode -M"
bind-key -T root MouseDrag1Border     resize-pane -M
bind-key -T root WheelUpPane          copy-mode
bind-key -T root WheelUpStatus        previous-window
bind-key -T root WheelDownStatus      next-window
bind-key -T root M-MouseDown3Pane     display-menu -T "#[align=centre]#{pane_index} (#{pane_id})" -t = -x M -y M "#{?mouse_word,Search For #[underscore]#{=/9/...:mouse_word},}" C-r "copy-mode -t=; send -Xt= search-backward \"#{q:mouse_word}\"" "#{?mouse_word,Type #[underscore]#{=/9/...:mouse_word},}" C-y "send-keys -l -- \"#{q:mouse_word}\"" "#{?mouse_word,Copy #[underscore]#{=/9/...:mouse_word},}" c "set-buffer -- \"#{q:mouse_word}\"" "#{?mouse_line,Copy Line,}" l "set-buffer -- \"#{q:mouse_line}\""  "Horizontal Split" h "split-window -h" "Vertical Split" v "split-window -v"  "Swap Up" u "swap-pane -U" "Swap Down" d "swap-pane -D" "#{?pane_marked_set,,-}Swap Marked" s swap-pane  Kill X kill-pane Respawn R "respawn-pane -k" "#{?pane_marked,Unmark,Mark}" m "select-pane -m" "#{?window_zoomed_flag,Unzoom,Zoom}" z "resize-pane -Z"
bind-key -T root M-Up                 select-pane -U
bind-key -T root M-Down               select-pane -D
bind-key -T root M-Left               select-pane -L
bind-key -T root M-Right              select-pane -R

Here is my tmux.conf

nikhil-mundra@nikhil-mundra:~$ cat ~/.tmux.conf
# remap prefix from 'C-b' to 'C-Capslock' https://blog.guilhermegarnier.com/2017/12/increasing-productivity-in-tmux-with-a-single-prefix-key/
set -g prefix S-Home
unbind C-b
bind-key S-Home send-prefix

# Start window numbering at 1
set -g base-index 1

# Scrollback
set -g history-limit 50000

# split panes using | and -
bind | split-window -h
bind - split-window -v
unbind '"'
unbind %

# switch panes using Alt-arrow without prefix
bind -n M-Left select-pane -L
bind -n M-Right select-pane -R
bind -n M-Up select-pane -U
bind -n M-Down select-pane -D

# Mouse
set-option -g mouse on

# List of plugins
set -g @plugin 'tmux-plugins/tpm'
set -g @plugin 'tmux-plugins/tmux-sensible'
set -g @plugin 'nhdaly/tmux-better-mouse-mode'

# Initialize TMUX plugin manager (keep this line at the very bottom of tmux.conf)
run -b '~/.tmux/plugins/tpm/tpm'

[subtleseeker]

Solved by enabling enable mouse reporting in Preferences>Profile>Terminal>Enable Mouse Reporting