One big issue is whether Turkey will let the lira weaken further now that the election is over or will be forced to do so by the markets.

A still more important question is whether Erdo?an will return to more orthodox economic policies or instead continue with his current mix of big spending and resisting interest rate rises. Many economists say this combination is unsustainable and risks a crisis in the aftermath of the election, with the lira vulnerable to attack.

Murat ??er, a former adviser to the Turkish central bank now at GlobalSource Partners, told POLITICO that he does not see a quick return to orthodoxy and the stickiest issue is the Turkish lira.

“Truly liquid reserves excluding gold, official swaps etc. are now down to a meager $20 billion-$25 billion, Turkish Lira liquidity had to be tightened drastically and controls on foreign currency demand have reached unsustainable proportions,” he said.

But Erdo?an is refusing to move. In his Ankara victory speech, he promised to keep interest rates low, which he said would reduce inflation — an argument many mainstream economists reject as absurd.

A defiant ally

Perhaps the biggest focus for other countries is what Erdo?an’s reelection means for Turkey’s stance in world affairs. Under his rule, Turkey has become a crucial actor and a defiant ally on many vital issues, not least Russia’s war in Ukraine.

Ankara refused to join sanctions on Russia following Vladimir Putin’s invasion of Ukraine but played a vital part in negotiating a deal to allow the export of Ukrainian grain through the Black Sea. As a NATO member, Turkey has approved Finland’s entry into the alliance but is still blocking the membership of Sweden.

Nasi from the Ankara Policy Center says Russia has made a series of economic gestures to Erdogan in the wake of elections such as delaying Turkey’s gas payments and the transfer of $5 billion for the construction of a nuclear power plant in Turkey.

“President Putin will certainly ask Erdo?an to return his generosity, and this might have some implications on Turkish foreign policy, perhaps a possible tilt toward Russia in Turkey’s balancing act with the West,” Nasi adds.

Peker of the Eurasia Group predicts that “Ankara will maintain robust diplomatic and economic ties with Moscow, while remaining a critical but difficult NATO ally.” As a result Erdo?an will ultimately ratify Sweden’s NATO membership if it is permitted to buy more F-16 jets from the U.S., he said.

Turkey has an uneasy relationship with the EU, not just because of European perceptions that Erdo?an has undermined the rule of law in his own country but also because of his threats to send millions of Syrian refugees currently housed in Turkey into the bloc.

“Turkey will give a message to the West with this election,” Erdo?an said in combative comments last month. “This country does not look at what the West says, neither when fighting terrorism nor in determining its economic policies.”

Now that the election is over, Erdo?an is more powerful than ever. Turkey’s NATO allies will be watching anxiously to see whether he delivers on his promises or on his threats.