You are sure that it was a genuine email from iTunes and not a phishing email :
Phishing and similar emails : Avoid phishing emails, fake 'virus' alerts, phony support calls, and other scams - Apple Support
Genuine iTunes emails : Identifying legitimate emails from the iTunes Store - Apple Support
Or what happens when you sign into the account on, for example, http://www.icloud.com on a browser ? Do you get a similar network ? If you are using a wifi network your location is got from the network that you are connected to, if it's location is incorrect in Apple's database you will get the wrong location on the email.