Wasn't there just recently a CPU update announced by intel with updated chips shipping starting in July of this year?
No. There were reports that Intel would have uncorked that 32nm production limitation problems by end of June. That hints that they may flush out the Xeon 3600 line or other ones, but they haven't publically signed up to a commitment to do it.
It seems likely they will but intel has a tendency to announce those on Mondays. Nothing has been announced today. It could be tomorrow though.
There are other wasy the iMac line could be updated though, a better GPU, offering the i5 chip in the 21.5 inch iMac, more memory, etc. Still pegging an update for tomorrow - a bump in specs of some kind.
unlikely. Apple could drop some of the core i5 duo chips with IGP into the lower end iMacs but there is nothing to put into the higher end ones until Intel does an update. Apple is going to bump the iMac just to move the lower end? Doesn't seem likely.
Intel can barely keep up with their 32nm commitments. I doubt they want to chop the prices on the 45nm stuff which would make pushing the prices down on the not yet year old Lynnfield i5/i7 used in the iMac down. Neither is Apple in hurry to eat that increased cost in lower end iMacs if they don't move.