Bond Traders Smell Victory As U.K. Ditches European Regulation

Bond traders may be about to reap some Brexit benefits.

The U.K. Treasury said Tuesday that Britain won’t follow upcoming European Union regulations on how financial transactions must be settled. The rules, which apply from February, have been a source of consternation to traders, who say they impose unworkable restrictions on deals that fail to settle quickly between buyers and sellers.

In a statement to Parliament, Chancellor of the Exchequer Rishi Sunak said firms should continue to apply the industry’s existing practices rather than the EU rules. “Any future legislative changes will be developed through dialogue with the financial-services industry, ...