Why is the core of a transformer laminated?

Transformer core is laminated to reduce Eddy currents. Eddy currents are formed in loop. In a whole piece of iron, a big loop of Eddy current will form, which will have stronger effect. So, we laminated the core such that Eddy currents are formed in each lamina separately, of smaller size (due to increased path size of current and increased resistance). Thus energy less due to Eddy currents is reduced.