Making chain of Master-Slave servers in mysql

Question

I have three servers, Server X, Y (Version 5.1.54-1ubuntu4-log), and Z (version 5.5.18-2build1~ppa1~oneiric-log).
I have the main mysql DB on X (innodb DB).
now I have created Master-Slave from X to Y. everything is working fine here.
and now i set Y as a master for Z.
when i do show slave status on Z (the third server)

show slave status\G
Slave_IO_State: Waiting for master to send event
...
Slave_IO_Running: Yes
Slave_SQL_Running: Yes
...
Seconds_Behind_Master: 0

in my.cnf on server Y, i have the following conf:

log-slave-updates=true
log-bin=mysql-bin

and show variables like '%slave%' i have

show variables like '%slave%';
+---------------------------+--------+
| Variable_name             | Value  |
+---------------------------+--------+
| init_slave                |        |
| log_slave_updates         | ON     |
| slave_compressed_protocol | OFF    |
| slave_exec_mode           | STRICT |
| slave_load_tmpdir         | /tmp   |
| slave_net_timeout         | 3600   |
| slave_skip_errors         | OFF    |
| slave_transaction_retries | 10     |
| sql_slave_skip_counter    |        |
+---------------------------+--------+

but the data is not synchronized and nothing has been moved from Y to Z. any idea about what might cause this??
Thanks for your help