Turkey has taken delivery of a controversial Russian missile defense system, angering U.S. officials and potentially triggering sanctions from Washington.
The shipment of S-400 components arrived in an airbase in the capital Ankara on Friday, the Turkish defense ministry said in an announcement on Twitter.
Following the announcement, the Turkish lira weakened 0.6% versus the U.S. dollar as the potential for U.S. sanctions was factored in by currency traders.
Timothy Ash, emerging markets senior sovereign strategist at Bluebay Asset Management said in an email Friday that the purchase marked a watershed for global military spend.
"If Turkey is able to buy S-400s without sanction, then a queue of over NATO members will be buying Russian military equipment which is often very cost effective and supplied on non-commercial terms," he said.
Ash added that the warming of ties between Turkey and Russia and the sale of the S-400 was "a huge challenge to the F35 project," and a "huge blow to the US defence industry."
U.S. officials see Ankara's purchase of the missile system as a worrying pivot toward warmer ties with Moscow. Turkey's integration of the Russian S-400 system is also viewed as a direct threat to the security of Lockheed Martin's F-35 fighter jet program.
Turkey has helped to build the F-35s and intends to buy at least 100 of the planes. However, Pentagon officials have said they do not want the hi-tech jets to be located near Russian engineers, who would be working in Turkey to install and support the S-400 systems.
"NATO countries need to procure military equipment that is interoperable with NATO systems. A Russian system would not meet that standard," a U.S. State Department official told CNBC on Monday.
The same official said that Turkey would face consequences for pursuing the deal.
Any potential sanctions would come under the Countering America's Adversaries Through Sanctions Act, which President Donald Trump signed in August 2017. At least 13 countries have expressed interest in buying a Russian missile system, despite the potential for triggering U.S. penalties.
The S-400 is viewed as the best missile available for engaging targets at longer distances, able to track and destroy stealth bombers, aircraft and cruise missiles.
A long-range radar tracks potential targets and relays data to a command vehicle. The command vehicle orders a launch and selects the best placed launch pad, usually cited on a truck. A separate engagement radar then guides the missile to the target.
U.S. NATO ambassador and former U.S. senator, Bailey Hutchison, told CNBC in June that Russia is trying to "continue to probe ways" to disrupt and weaken the NATO alliance, adding that a Russian missile system under the same military control as an F-35 fighter jet was unacceptable.
"You have to make a choice. You can have one or the other but not both," she said.
CNBC's Amanda Macias contributed to this report.