By Jonathan Kent BBC correspondent in Kuala Lumpur

Anwar Ibrahim has been in jail for nearly six years

A week ago, I would not have dreamed of laying money on the release of Anwar Ibrahim.

Rumours of a deal between the former deputy prime minister and the government have been rife for months, but nothing had materialised.

Appeal after appeal had been rejected - and this was very much Mr Anwar's last hurrah.

Malaysia's Federal Court had been due to review its decision to reject his final appeal back in July, but the hearing was postponed several times.

Indeed it was starting to become something of a joke - one that the cartoonist Zunar exploited mercilessly via the news portal Malaysiakini.com.

Most recently the date was set for 28 August, three days before Malaysia's national day celebrations.

Bells started to go off when that date was moved to 2 September.

Was something afoot that the government did not want to overshadow Malaysia's annual outpouring of patriotic pride?

'Momentous'

The two days before the hearing I met Mr Anwar's wife, Wan Azizah Wan Ismail, at the launch of a food sovereignty campaign in the Penang state constituency she inherited from her husband.

"This means the culmination of many months or years of waiting," she told me.

"From what we hear it does appear to be favourable - and I do not want to put out a glimmer of hope."

It was the first time she had spoken in such positive terms. By the time I returned to Kuala Lumpur, the rumours were gathering weight.

It all left one feeling that some kind of deal just may have been done

Some suggested that the government would find a formula to release Mr Anwar, perhaps rearranging his two sentences - six years for abuse of power and nine for sodomy - to run concurrently, rather than consecutively.

It was clear something was up by the time I spoke to Mr Anwar's endearing and stalwart lawyer, Sankara Nair, on the night before the hearing.

"Oh no, I'm not putting any faith in these rumours," he said.

He then proceeded to spell out in minute detail the next day's schedule of press conferences, passport applications, a possible plane journey to Germany and surgery.

ANWAR'S LEGAL BATTLE Sept 98 - Sacked and arrested April 99 - Jailed for six years for corruption relating to alleged sodomy July 00 - Sentenced to further nine years for sodomy - alleged to have had sex with five men July 2002 - Loses appeal against corruption conviction Sept 2004 - Wins appeal against sodomy conviction Profile: Anwar Ibrahim Anwar's release: have your say

Try as he might, he could not manage to sound like a man expecting to accompany his client back to jail.

It all left one feeling that some kind of deal just may have been done.

What transpired was probably the most momentous day in Malaysia since Dr Mahathir Mohamad, the country's leader for 22 years, stepped down in October 2003.

Malaysian politics took a new and unfathomable twist as Mr Anwar stepped out of the courtroom and met his supporters.

Unknown territory

Mr Anwar is a rare thing in Malaysian politics - a man with intellect and charisma.

As a student activist, he was instrumental in building the country's Islamic youth movement ABIM.

In the 1980s, he was the government's trump card against the conservative Islamist opposition.

At that time, he was both a Renaissance man beloved of Western journalists and the impassioned voice of local Muslim aspirations.

Abdullah has promised to let democracy thrive under his rule

What are his options in this new decade, which he tasted as a free man for the first time on Thursday?

Firstly, Mr Anwar must look to his health. He looked genuinely frail in court on Thursday and his family are concerned that he does not exhaust himself.

Even on his return from treatment abroad, he will have to assess his support.

Only some 500 people turned up to see him released, not the thousands who demonstrated for him five years ago. There is also the fact that he has only been cleared on one of two charges.

"Because of the corruption conviction, for which he served four years of a six year sentence, he'll be barred from standing for office until at least April 2008," said analyst and former opposition member of parliament, James Wong.

But that fact in itself does not prevent Mr Anwar from campaigning - and he is a very able campaigner.

The question is, whom will he campaign for: the government and his old United Malays National Organisation (Umno), or for the opposition Keadilan (National Justice) Party, which he helped found after his fall?

Mr Wong thinks he will make his bed with the opposition.

Mr Anwar's supporters say he was charged for politically motivates

"I don't think he will go back to Umno. Firstly, Umno people can't accept him any more. He made too many enemies and he split the party," he explained.

"Second, he would lose his standing among opposition supporters. Most likely, he would try to build up Keadilan as a multi-racial opposition party with a moderate Muslim core," he added.

That would really take Malaysian politics into unknown territory.

Who benefits?

The focus on Mr Anwar means we are forgetting the politician who will probably gain most from Mr Anwar's release - Prime Minister Abdullah Badawi.

"I think this story is about Abdullah first and Anwar second," one analyst told me.

"I think he's sending out the signal: 'I've got far too much to do, and far to little time to do it in, to have baggage like the Anwar issue hanging around,'" he added.

Mr Anwar's release may indeed be a sign of how secure Mr Abdullah is feeling, having won a landslide general election victory in March and strolled through a potentially tricky by-election last month.

At one fell swoop, Mr Anwar's release has gone some way to restoring faith in the judicial system, removing the major source of division in the Malay community that backs Abdullah's Umno party.

And it makes Mr Abdullah look like a nice guy at home and abroad.

It also further distances him from his predecessor, Dr Mahathir, and silences those critics who like to depict him as Dr Mahathir's puppet.

And the move gives his would-be successors - none of whom can boast Mr Anwar's intellectual flair or charisma - something to worry about.