Pip or "percentage in point," refers to the very last digit of a currency price.

As an illustrative example, take EUR/USD at 1.2635. If the sell price were to increase to 1.2636 we have a one pip increase. Should the EUR/USD sell price move from 1.2635 up to 1.2735, we say EUR/USD increased 100 pips.

In the example of EURUSD, one pip is worth 1/100th of a US Dollar cent. Because currency traders are concerned with relatively small movements in the forex market, traders talk about that movement in terms of pips.

Learn More About How Economics Move Markets

Economic Reports by Country United States | Euro-Zone | Japan | United Kingdom | Canada | Switzerland | Australia | New Zealand

Economic Reports by Release Type Balance of Payments | GDP & Output | Conf & Sentiment | Prices, Wages & Spending | Monetary Policy | Housing | Employment