Its hard to say, not seeing you, but I will certainly give it my best shot.
You may have the start of a fungal or bacterial infection of the penis, called balanitis. While most cases of this are in UNcircumsized men, circumsized men can get this as well. Balantitis, IF fungal, can be treated by over the counter anti fungal creams. HOWEVER, I do not know 100% that it IS a fungal infection (or even that it is Balantitis) though from what you write it does appear it could be such. Balantitis can also be caused by bacteria; if this is the case it would need antibiotic ointments or oral medications (depending on severity).
I therefore reccomend you see your physician regarding this, especially as it is a common occurence. And of course, not seeing you, this could be an entirely different thing; I am just stating what may be most probable. Certainly some STD's can cause a rash. One in particular can leave a painless red sort of ulceration that does not itch; that is syphilis. You state you and your wife are monagamous, so this is low on my list but it must be mentioned.
I would make an appointment to have this evaluated just to err on the side of safety.
Here is a helpful website regarding balantitis: http://www.nlm.nih.gov/medlineplus/ency/article/000862.htm
You will see it refers mainly to uncircumsized men.
Here is a chart of the STDs and their symptoms: http://www.fwhc.org/health/std.htm
I hope I was able to help,