First, perform the multiplication: $1.25 \times 3.2 = 4.0$. Since $3.2$ has 2 significant figures, the result of the multiplication must also have 2 significant figures, which makes it $4.0$ (having 1 decimal place). Now perform the subtraction: $4.0 - 0.12 = 3.88$. Since $4.0$ has only 1 decimal place, the final result must be rounded to 1 decimal place. Rounding $3.88$ to 1 decimal place gives $3.9$.