In finance, the smallest price change that a given exchange rate can make is referred to as percentage in point also known as pip or point. Since most major currency pairs are priced to four decimal places, so the smallest change is the change in the last decimal point, for most of the currency pairs this is the equivalent of 1/100 of one percent, or one basis point.
Some additional information is needed in order to calculate the pip value or to know that how much is one pip, this information includes: trading size, leverage used, and the actual rate of that particular pair for which you want to calculate the value of pip. For instance, in case of US Dollar, having the trading volume of 1 lot (generally it is equal to 100,000 units of the base currency), 10 USD will be the minimum fluctuation point.
