Yes, Firefox will do 128-bit encryption. You can see it on this page, just click the blue mozilla.com site identity button in the URL bar, and then hit More Information... See the Technical Details at the bottom of that Page Info window.

Firefox uses AES-56 (256 bit encryption) if websites support it.
128 bit encryption is no longer recommended these days as a lot of such ciphers have been cracked during the past years.
I keep all 128 bit ciphers disabled to force websites to use stronger encryption.

• https://www.fortify.net/sslcheck.html