Question

What are eddy currents? how are they produced? how can they be minimized?

Answer 1

In a transformer, the magnetic flux created by the primary coil induces a current in the core. This occurs in order to oppose the charge that produced the magnetic flux (Lenz's Law). The currents flowing in the core are called eddy currents.
These currents produce heat, using up energy and so causing inefficiency.An eddy current is a swirling current set up in a conductor in response to a changing magnetic field. By Lenz's law, the current swirls in such a way as to create a magnetic field opposing the change; to do this in a conductor, electrons swirl in a plane perpendicular to the magnetic field. 
Reducing eddy currents. To reduce the eddy currents in the metal armature of motors the wire is wrapped around a number of thin metal sheets called laminations. This is done because the eddy currents would heat up the metal and so reduce(dampen) its efficiency.

Answer 2

Hey !!

Eddy Currents :- When a thick metallic piece is placed in a time varying magnetic field, the magnetic field the magnetic flux linked with the plate changes, the  induced currents are set up in the conductor ; these currents are called eddy currents. These currents are sometimes so strong, that the metallic plate becomes red hot.

Due to heavy eddy currents produced in the core of a transformer, large amount of energy is wasted in the form of undesirable heat.

MINIMISATION OF EDDY CURRENT

Eddy currents may be minimised by using laminated core of soft iron. The resistance of the laminated core increases and the eddy currents are reduced and wastage of energy is also reduced.

GOOD LUCK !!