Making a env running windows 11 pro using anaconda3

as you can see here I made and env called Test3P310 then activated it
(base) D:\anaconda3>conda activate Test3P310

after confirming the env Python version level…
(Test3P310) D:\anaconda3>python --version
Python 3.10.9

Then i ran the command as shown below…
(Test3P310) D:\anaconda3>conda list python

packages in environment at D:\anaconda3\envs\Test3P310:

Name Version Build Channel

python 3.10.11 h4de0772_0_cpython conda-forge

I am new to this so even thought the versions level was really insignificant I wanted to try and sync up the to version and ran this command
(Test3P310) D:\anaconda3>conda update python

well that update the python 3.10.11 shown above to python 3.11.4. Is that how it is suppose to work? and what effect if any will it have on my libraries and packages I have installed or plan to install?