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AMSTERDAM (Reuters) – Dutch center-right Prime Minister Mark Rutte fought off the challenge of anti-Islam and anti-EU rival Geert Wilders to score an election victory that was hailed across Europe on Thursday by governments facing a rising wave of nationalism.

The euro gained as the results of Wednesday’s vote showed a clear win for Rutte, albeit with fewer seats than in the last parliament.

He declared it an “evening in which the Netherlands, after Brexit, after the American elections, said ‘stop’ to the wrong kind of populism.”

READ MORE: ‘Dutch Donald Trump’ Geert Wilders easily bested in Netherlands election

The result was a disappointment for Wilders, who had led in opinion polls until late in the campaign and had hoped to pull off an anti-establishment triumph in the first of three key elections in the European Union this year.

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Political analysts said Rutte won on a mix of factors, not all of which may apply to France, where far-right National Front leader Marine Le Pen is expected to make it through to a second-round runoff in a presidential election in May.

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Rutte received congratulations from European leaders including German Chancellor Angela Merkel, who faces a strong Social Democrat challenge in a September election and has shed some support to an anti-immigration party, Alternative for Germany, which is set to enter the federal parliament for the first time.

Merkel told Rutte: “I look forward to continuing our good cooperation as friends, neighbors, Europeans,” her spokesman said.

Standoff with Turkey gave Ruttee an edge

A number of parties including Rutte’s VVD and the third-placed Christian Democrats (CDA) have already adopted most of Wilders’ anti-immigration platform, if not his fiery anti-Islam rhetoric.

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But with a strong second-place finish, Wilders warned Rutte that he had not seen the last of his Party for Freedom, which has dominated the debate on immigration. Wilders said he wanted to participate in coalition talks, even though mainstream parties have ruled out working with him.

“We were the 3rd largest party of the Netherlands. Now we are the 2nd largest party. Next time we will be number 1,” he said.

Supertrots op al onze kiezers, meer dan 1 miljoen Nederlanders! Bedankt! 12 jaar na oprichting is PVV de 2e partij van NL! Geweldig!! pic.twitter.com/PmlHnhyfsg — Geert Wilders (@geertwilderspvv) March 16, 2017

Supertrots op al onze kiezers, meer dan 1 miljoen Nederlanders! Bedankt! 12 jaar na oprichting is PVV de 2e partij van NL! Geweldig!! pic.twitter.com/PmlHnhyfsg — Geert Wilders (@geertwilderspvv) March 16, 2017

Rutte got a last-minute boost from a diplomatic row with Turkey, which allowed him to take a tough line on a majority Muslim country during an election campaign in which immigration and integration have been key issues.

At 78 percent, turnout was the highest in a decade in an election that was a test of whether theDutch wanted to end decades of liberalism and choose a nationalist, anti-immigrant path by voting for Wilders and his promise to “de-Islamicise” the Netherlands and quit the EU.

Focus shifts to Le Pen

The result was a relief to mainstream parties across Europe, particularly in France and Germany, where right-wing nationalists hope to make a big impact in this year’s elections, potentially posing an existential threat to the EU.

France’s Foreign Minister Jean-Marc Ayrault tweeted: “Congratulations to the Dutch for stemming the rise of the far-right.”

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But Mabel Berezin, professor of sociology at Cornell University in the United States, said defeat for Wilders, who has been in parliament for nearly two decades, should not be considered a sign that European populism is waning.

“He does not represent a populist wave. Rather, he is part of the political landscape and how his party fares does not tell us much about European populism,” she said.

“The real bellwether election will be Marine Le Pen’s quest for the French presidency, starting April 23 – that is where the populist action is and that is what we should be focusing upon.”

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The spat did not hurt the chances of Denk, a party supported by Dutch Turks, which looked set to win three seats, becoming the first ever ethnic minority party in parliament, in a possible sign of deepening ethnic division.

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But, while Rutte averted what in the early stages of the campaign looked like a possible victory for Wilders, years of austerity pushed down his share of the vote. His junior partner in the outgoing coalition, Labour, suffered its worst ever result, winning just nine seats, down from 38 last time.

That means it will likely take months for Rutte to negotiate a ruling coalition, with at least three other parties needed to reach a majority in parliament.

Wilders’ PVV will have a third more seats in parliament than before, but is still well below a 2010 high of 24 seats. Support for the two most pro-EU parties, the progressive D66 and GreenLeft, was way up.