Eddy currents are loops of electric current that are induced within conductors when they are exposed to a changing magnetic field. These currents flow in circular paths and can create heat due to the resistance of the material. This phenomenon is commonly observed in metals and is a result of Faraday's law of electromagnetic induction. Eddy currents have practical applications, such as in induction heating and magnetic braking systems. However, they can also lead to energy losses in electrical devices, like transformers and motors, where they generate unwanted heat. Engineers often design components to minimize these losses by using laminated materials or other techniques.