In forex trading, a pip is the smallest unit of measurement used to express the change in the value of a currency pair, and it represents the fourth decimal place in most currency pairs, except for some currency pairs that have a Japanese yen as the quote currency, where a pip is represented by the second decimal place. For example, if the EUR/USD currency pair moves from 1.1800 to 1.1810, this represents a movement of 10 pips.
A pipette, on the other hand, is a fraction of a pip and represents the fifth decimal place in currency pairs that use four decimal places, or the third decimal place in currency pairs that use two decimal places for the quote currency (such as the USD/JPY). In other words, a pipette is 1/10th of a pip. For example, if the EUR/USD currency pair moves from 1.18000 to 1.18010, this represents a movement of 1 pipette.
Pipettes are often used by brokers to provide more accurate pricing and smaller spreads to traders. Some trading platforms will display prices in both pips and pipettes, while others may only display prices in pips, with pipette movements being implied.