The Federal Reserve stunned economists today by slashing its benchmark interest rate by a whopping half-point.

Traders on Thursday added to bets the U.S. Federal Reserve's next rate cut will be smaller than the one it delivered on Wednesday, after economic data showed an unexpected drop in unemployment insurance claims.

The Fed meets eight times a year to assess the health of the US economy and vote on the federal funds rate, the rate banks use to lend and borrow money. While the Fed’s decision to change rates doesn’t directly affect savings rates, changes in APYs typically follow. The changes can take several weeks or even months to take effect.