While using SXA I noticed the use of both local: and page: with respect to the data source path. What is the difference?

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Have a look at the official documentation for complete details on its usage.

SXA uses the page: notation for components stored underneath a page in the page data folder. In many cases, the page: and local: notation give you the same result. When used in partial designs, the local: notation results in items taken from under that partial design whereas the page: forces SXA to always look for the data source under the page.

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