Used in forex, a pip is one-hundredth of one percent, or the fourth decimal place (0.0001). A pip is the smallest price move that an exchange rate can make based on the forex market convention. Most currency pairs are priced out to four decimal places and the pip change is the last (fourth) decimal point. Currency base pairs are typically quoted where the bid-ask spread is measured in pips. For example, the smallest move the USD/EUR currency pair can make is $0.0001 or one basis point.