This setting is the percentage that the nudge tempo commands increase or decrease the tempo by. The nudge tempo commands are Image/Tempo/Nudge Up (+ key) and Image/Tempo/Nudge Down (- key). The setting ranges from 0.1% to 0.9%.
For example, if Tempo Nudge is set to 0.25% (the default) and the tempo is 120, pressing the + key once makes the tempo 120.3 (120 × 1.0025 = 120.3).
Tempo nudge is a trade-off (precision versus speed) and a matter of taste. If it's too small, you won't be able to adjust the tempo quickly enough. If it's too big, you won't be able to get close enough to the desired tempo.