A pip is short from a “percentage in point”. A pip is the smallest price move that an exchange rate can make. Almost all currency pairs are priced out to four decimal places, and the pip change is the last (fourth) decimal point. A pip is thus equivalent to 1/100 of 1% or one basis point. The only exception to the rule is currency pairs with Japanese Yen (EUR/JPY, USD/JPY). The currency pairs are priced out to two decimal places, and the pip change is the second (last) decimal point.