One basis point is equal to 1/1000 of 1% and is used to denote the percentage change in the price of a financial instrument.

In currency markets it is more common to refer to pips, which represent the smallest unit of change of the quote of a currency pair, for example one pip in EUR/USD would be 0.0001 irrespective of the current level of the exchange rate.


Keywords: Basis point, currency markets, currency pair.

Currency management guide