A demoralising conflict (3,2,6)

I believe the answer is:

war of nerves

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'conflict' is the definition.
(I have seen 'Psychological conflict ' mean 'war of nerves' so perhaps 'conflict' could also mean 'war of nerves')

I cannot understand how the rest of the clue works.

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(Other definitions for war of nerves that I've seen before include "Psychological tactics in contest" , "Psychological conflict" .)

I've seen this clue in The Globe and Mail.

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